Question

Operating data for Blue Spruce Corp. are presented below. 2022 2021 Sales revenue Cost of goods sold Selling expenses $834.000 $623,500 530,700 409,600 129,000 76,200 79,600 51.000 33,500 26,800 61,200 59,900 Administrative expenses Income tax expense Net income Prepare a schedule showing a vertical analysis for 2022 and 2021. (Round percentages to 1 decimal place, e.g. 12.1%.) BLUE SPRUCE CORP. Condensed Income Statement 2022 2021 Amount Percent Amount Percent Sales $834,000 % $623.500 Cost of goods sold 530,700 % 409,600 Gross profit 303,300 213.900 Selling expenses 129,000 76,200 Administrative expenses 79,600 51,000 Total operating expenses 208,600 127.200 Income before income taxes 94,700 86,700 Income tax expense 33,500 26.800 Net income $ 61,200 % $ 59,900

Answer 1

Common size income Statement is the Statement which contains the proportion of each element with the sales. Percent = Amount of Item / Sales BLUE SPRUCE CORP Comparative Income Statement Year ended December 31 2022 2021 Amount Percent Amount Percent Sales 834000 100.0% 623500 100.0% Cost of Goods Sold 530700 63.6% 409600 65.7% Gross Profit 303300 36.4% 213900 34.3% Selling Expenses 129000 15.5% 76200 12.2% Administrative Expenses 79600 9.5% 51000 8.2% Total opearting Expenses 208600 25.0% 127200 20.4% Income From opeartions 947001 11.4% 86700 13.9% income taxes Expneses 33500 4.0% 26800 4.3% Net income 61200 7.3% 59900 9.6%